Yesterday, unnoticed by most, Baptist Press released this article: SBC EC to launch study about investment of institutional funds.
This is relevant in light of the decision facing Southwestern Baptist Theological Seminary Trustees concerning the $90 Million trust that they almost moved to a secular investment fund, among whose investments included several “Sin Stocks.”
For the uninitiated, the term “Sin Stocks” was originated and often used by resurgence leaders when criticizing the old Annuity Board for several investments of minister funds in companies that profited from “sin,” such as alcohol and sexual promiscuity.
If you are interested in reading the background of the SWBTS story, you can do so at SBC Outpost. There are a couple posts that follow the one linked, if you care to read even further. If you check out the comments, and there are many, you will find quite a diverse discussion.
There are a few things to be noted, here.
First, Dr. Chapman has called for a study and only a study. There is no action at this time. Opponents may try to stop this before it really gets started, though I don’t know why there would be many opponents. Well, actually, I do.
This will be read as reactionary to SWBTS and their pending issues. As a result, several behind the SWBTS move are apt to take this personally. I hope this is not the case, but I am afraid that it will be.
I can think of one good reasons why this is not personal. Dr. Chapman said, in his letter, that this move had come after several years of consideration. That consideration came from a number of Baptist agencies moving the money from Baptist Foundation(s) over several years time. This is also noted in the letter. If we are to believe that this study is a deliberate reaction to SWBTS alone, then we must believe that Morris Chapman is intentionally and systematically lying.
Yeah. I don’t. I hope you don’t either.
I am not saying that SWBTS’ issue had no effect but that this is clearly not a singular response to the SWBTS situation.
Now, as far as the potential of the move under study, there are a few important observations to be made.
First, this involves national agencies only – those listed in SBC By-Law 14. If local or state Baptist agencies want Guidestone to help manage their monies, they have to receive permission to do so. This will keep Guidestone, a rapidly growing financial entity, from dominating the Baptist landscape in this area. Such a thing would be very unhealthy. The Baptist Foundation (national) would have some competition, but only in the area of fund management. Guidestone would continue to focus on retirement and insurance for its main purpose and the Baptist Foundation would also continue to focus on any other areas of ministry for which it is responsible.
By making Guidestone available to our national agencies, we would free up THE investment arm of the Southern Baptist Convention to resource the investment needs of its own partner agencies. Obviously, such a move would allow those agencies to find what they are needing within the Southern Baptist family. Guidestone’s investments are already monitored with our convictions and desires in mind. It would, therefore, avoid the prickly issues that arise when “sin stocks” are involved in secular investment corporations.
Frankly, I think it is an outstanding idea, but then, if you read through the comments at SBC Outpost, you already knew that. What can I say? Wes Kenney already thinks I am prescient. Maybe he’s right. ;)
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Matt Snowden
on Nov 8th, 2006
@ 6:11 am:
Art,
Thanks for keeping this issue in circulation. Ole Walter Wink was correct about at least one thing. We often become mirror images of those we war against. I think we all should keep that in mind. Thanks for your service to our convention.
Marty Duren
on Nov 8th, 2006
@ 6:39 am:
Guidestone, huh? Looks like somebody’s been reading Twelve Witnesses. Good job!
jasonk
on Nov 8th, 2006
@ 9:29 am:
Guidestone is going to start managing money for one reason and one reason only. Profits.
I read an article yesterday on the issue of bonuses paid out to fund managers at the top firms across the country. They are in the billions of dollars. The BONUSES paid to the managers are in the billions of dollars. Money is being made right and left, and Guidestone, in my opinion, wants to profit off of it. That’s no sin. Good luck to them.
There are some problems that I think Chapman will run into. One is compliance. Will his team of legal professionals be able to sort through the web of compliance issues they will face? Another is the mandate we are given by the government to act “in the best interest of our clients.” When everything is done in house, it is much more difficult to do that, because the temptation is to invest the money in proprietary investments, rather than in the best ones available.
I have said it on Marty’s blog, and my own, that I don’t have a problem with a Christian investing money in so called “sin stocks.” First because it has never been proven that morally conscious investments out perform standard investments. Also because it is an example of God taking money from the wrong and giving it to the good. It is a scriptural principle.
Art Rogers
on Nov 8th, 2006
@ 1:46 pm:
Matt & Marty – Thanks.
Jason,
Guidestone is not the initiator of this study. Dr. Chapman is, and it is clear that he would not benefit in any way more than any of us. Back to that in a moment, but let me first say… OS Hawkins is a good guy, and I like him. He seems to me to be self confident, extremely competent and friendly to all, whether or not he agrees with you. It is also well known that he is a friend of Dr. Patterson. If personalities, or SWBTS, were the issue, handing control of trust monies over to a friend of Dr. Patterson would not be considered. I know, Jason, that you did not say anything about that, but I am taking the opportunity afforded by your comment to reiterate the main point: This is not personal, nor is it directly responding to SWBTS, but it is a legitimate a concern for what is best for all of us.
Now back to Guidestone. This is a non-profit entity whose job it is to secure the present health and future health and retirement of Southern Baptist Ministers. If they profit greatly, then so do I. Am I for that? Sure!
I have a different view of sin stocks than you. I don’t want to support things that facilitate people furthering their rebellion against God. Even if it does pay. I don’t think it is a good, Scriptural practice for our Convention agencies. If you feel differently on a personal level, then that is a third tier issue.
When evaluating principles, I often play out those principles in my mind, placing them in extreme situations. By taking principles to the absurd, decisions often are more easy for me. Here is an example of this principle in the extreme.
Last year, or maybe it was two years ago, I was surfing ebay for stuff. Usually, I buy golf clubs, electronics and whatnot on their site. As I was surfing, I came across the advertisement of an internet franchise that I could purchase in an auction. The franchise was a sex based internet store. All the buyer of this franchise would have to do is set up the site. Shopping cart software, pictures of the products, ordering/shipping/tracking systems, even the website layout were already included. You didn’t even stock any products, just run the website. It boggled my mind. I never knew such a thing existed.
Now, the sex industry in America is a multi – BILLION dollar industry annually. I did a “pornography” study for my church last year and the research I found at xxxchurch.com was astounding. [If you don't know, xxxchurch.com is a Christian website dedicated to helping people break porn addiction.] If I had just a small percentage of the money spent in the sex industry today, I could be making tens of thousands of dollars each year.
But there is no way I could do that. Oh, I think I am net savvy enough to keep it a secret – keep Christians and church members from finding out, if I wanted to do that. I just don’t want to do that. I couldn’t live with myself thinking I was making money off of people headed down the road to destruction. I don’t really care if they are going to go there anyway. That just doesn’t matter.
In other words, I do have a problem with sin stocks. It isn’t worth it to me, no matter how much money I could make. I also would like to see our institutions reflect that conviction. Therefore, the Guidestone move, in my eyes, is a very good one.
jasonk
on Nov 8th, 2006
@ 3:39 pm:
Thanks Art, for your exceptionally gracious response. You are a real gentleman.
I don’t doubt Hawkins’ sincerity, nor Chapman’s. I just think that they are trying to keep more of the SBCs money in-house. That is certainly commendable. If they can avoid paying fees to a broker or an advisor, then that only helps those of you who are vested in the plan, and I agree with you, that is a great thing. The only problem is that often, when we try to save money, we can lose it in the process. It is my opinion, and mine alone, that this is what is partly wrong with a group managing their own investments. They make decisions based more on emotion than on facts and intellect, and that can cost more in the long run than they would save. That is all I am saying. My firm refuses to sell its own funds, only the funds of outside managers. It is our contention that this frees us up to make the most objective recommendations to our clients.
As for sin stocks, we can disagree on this third tier issue. Like you, I would never buy in to a porn website deal like you were recommending, not only because it would facilitate sin, but because it just sounds suspect to me. However, we run into a problem when we try to cut all “sin” industries out of our investments. For example, and you may remember this from the old Annuity Board issue from the 80s and 90s, Kmart and Waldenbooks were owned by the same company. Waldenbooks sold Penthouse Magazine. So the Annuity Board did away with both. That can hurt our investments. Many retail establishments, especially outside of Oklahoma, sell liquor, and yet we are invested in them. In Texas, the HEB chain refused to sell alcohol in their stores, because of the strong Christian convictions of Mr. Butts, the owner. His sons pleaded with him to change his mind (along with the name of the store lol), but he would not relent. That is, until he passed away. His sons began selling alcohol in the stores, and things turned around once again for the chain. Had they not been successful in allowing the sale of liquor, the store and all Mr. Butts had done to build it up would have gone under. As it stands, these guys are making a lot of money, and continuing to fund their dad’s charity trust funds, and being a blessing to many people, and many churches as well.
All I am saying is that it is hard to sort through all the minutia of a company’s holdings, and where their profits are generated from. Nabisco and Kraft are owned by a company that sells cigarettes and beer. And they pay a great dividend as well!
Thanks again for your very Christ-like response Art. I am most appreciative.
Art Rogers
on Nov 8th, 2006
@ 4:29 pm:
Jason,
Thanks for YOUR response and attitude. It’s quite a friendly place around here, huh? ;)
Guidestone’s relationship would not be a requirement for familial entities, so if they want the management funds, they will have to perform – and they have been performing. They would be in the marketplace, the same as others. This study is about whether or not they can open up the possibility to compete for SB dollars with an investment strategy that does draw certain lines.
Point taken about KMart and Waldenbooks. I do remember that.
Also, the company that owns Kraft and Nabisco was a corporate sponsor of the “Gay Games” this last year, promoting the homosexual political agenda. I still have Kraft Mac & Cheese in my house. The whole issue of sin stocks is complex, but still an issue with which we must deal
I know you didn’t mean to say that I was suggesting any investments in porn, but I need to clarify for anyone else reading that I did not and would not. Moreover, what was being sold was not a “porn site,” but a site that sold “novelties.” Is that a tactful way to explain what it was?
That it was on ebay shocked me. I don’t think I have been back since then. I had been naive enough to think that ebay filtered that kind of stuff and that it couldn’t be gotten to by kids. Wrong. Oh well. Like I say, I haven’t been back.
jasonk
on Nov 8th, 2006
@ 6:14 pm:
That is a shame about Altria Group sponsoring the Gay Games. That’s one event I would surely want to miss. Altria is a great stock! It is currently paying a 4.10% dividend. My firm has a buy recommendation on it. Maybe if I gave up the Mac and Cheese, I could own the stock…
Point taken on the “novelties.” Enough said.
I hope Guidestone is successful and is able to accomplish the goal of keeping more SBC dollars where they belong–in the accounts of the clients. I am all about smaller fees and commissions.
Thanks again for the interesting dialogue!
GeneMBridges
on Nov 8th, 2006
@ 9:05 pm:
Wes Kenney already thinks I am prescient.
Well, Brother, I wouldn’t go that far…if so, that makes you this Miss Cleo of Blogtown…:D
Art Rogers
on Nov 8th, 2006
@ 9:09 pm:
No, Gene, prescient, not fraudulant. ;)
Wes Kenney
on Nov 8th, 2006
@ 10:32 pm:
Did I say “prescient”? Are you sure I didn’t say “present”? ;-)
Tim Rogers
on Nov 9th, 2006
@ 4:18 am:
Brother Art,
I switched to IE7 and now your main page’s column breaks are over into your articles. Is this something going on with my stuff?
Blessings,
Tim